Spring is usually the busiest time for the housing market, but the coronavirus has changed that, too, and one listener asks Joel and Matt if they should buy now or wait until later. They’re already under contract, but have been advised that the market could be on a downturn, and if they wait, they could get a better price on the house. Not so fast, Joel says; while it’s true that banks have seen the lowest level of housing loan applications since 2015, that’s no indication that the market will change significantly, since housing inventory is still low. And right now, mortgage rates are incredibly low, so buying now with those rates could actually mean more savings in the long run than waiting for a cheaper price in the future. For that reason, refinancing an existing mortgage could be a good move, too.
Another listener asks about the stimulus checks; while Matt and Joel had a whole episode about how to spend that money wisely, they didn’t cover the tax implications of those checks. The highlights? Stimulus checks are being recorded as tax credits, and aren’t subject to income tax withholding, so the entire $1200 is yours to spend. Unemployment payments do have to be declared – and taxed – as income, but not the stimulus check. Many people are mistaking it as an advance on their tax return simply because the payments began on April 15, the traditional tax day, but that’s just a coincidence in timing, they say. Listen to the episode for more great information about the housing market, taxes, lending standards, and other tips to get you through the Covid crisis on How To Money.